NILS Scheme Australia — How to Apply & Credit Impact (2026)

Quick Answer: The NILS (No Interest Loan Scheme) provides loans of up to $2,000 for essential goods and services to Australians on low incomes — with zero interest, zero fees, and no credit checks. Because NILS providers do not conduct credit checks and do not report to credit bureaus, a NILS loan does not appear on your credit file and does not affect your credit score. NILS is administered through Good Shepherd in partnership with NAB and the Federal Government. It is specifically designed as a safe, accessible alternative to payday loans for people who may have bad credit or no credit history. If bad credit is preventing you from accessing finance beyond NILS limits, Australian Credit Solutions may be able to remove incorrect entries from your file under the Privacy Act 1988. 98% success rate. No Win No Fee. ASIC ACL 532003. Industry Excellence Award 2022, 2023 & 2024. 4.9/5 from 976+ reviews. Over 5,000 Australians helped since 2014.

For Australians facing financial hardship, the NILS scheme is one of the most valuable — and underutilised — financial assistance programs available. Here's everything you need to know.

What Is the NILS Scheme?

NILS (No Interest Loan Scheme) is a community finance program delivered by Good Shepherd Australia New Zealand in partnership with NAB and the Australian Government. It provides small loans to people on low incomes with no interest, no fees, and no credit checks.

Key features:

• Loan amounts: Up to $2,000 (up to $3,000 for essential household items in some programs)
• Interest: 0% — no interest whatsoever
• Fees: None
• Repayment: Up to 24 months, tailored to your budget
• Credit check: None required
• Eligibility: Low income (Centrelink, pension, low-wage employment), Australian resident

What Can NILS Loans Be Used For?

NILS loans are designated for essential goods and services — not cash:

Typically approved:

• White goods (washing machine, fridge, stove)
• Furniture (bed, table, couch)
• Essential electronics (laptop for study, phone for work)
• Medical or dental expenses
• Car repairs (for essential work transport)
• Educational costs (school uniforms, laptops)
• Essential home repairs

Not approved:

• Cash advances
• Rent arrears or bills (in most programs)
• Luxury or non-essential items
• Consolidating other debts

The loan is typically paid directly to the supplier/retailer — not to the applicant. For more, see our guide on bad credit for pensioners in australia: fix your credit file in 2026.

Does NILS Affect Your Credit Score?

No — NILS loans do not appear on your credit file and do not affect your credit score in any way. This is by design. Australian Credit Solutions offers how our specialists can help improve your score.

NILS providers are not traditional credit providers reporting to Equifax, Experian, or Illion. They do not run credit checks, and they do not report loan activity to bureaus. A NILS loan is invisible to any future lender conducting a credit assessment.

This makes NILS uniquely suitable for:

• People with defaults or bad credit who cannot access standard credit products
• People with no credit history who would normally be declined
• Recent migrants with thin Australian credit files
• People on Centrelink who don't want to affect their credit file

Who Qualifies for a NILS Loan?

Eligibility criteria (as at 2026):

Income requirement: You must be on a low income — generally defined as receiving Centrelink benefits or having an after-tax income below approximately $70,000 per year for singles or $100,000 for couples/families. Criteria vary slightly by provider.

Residency: Must be an Australian citizen or permanent resident, or hold an eligible visa. Temporary visa holders on humanitarian grounds may also qualify in some programs.

Capacity to repay: NILS assesses whether you can afford the repayments — not through a credit check, but through a conversation about your income and expenses. The repayment must be affordable within your current budget.

Location: Must be in an area serviced by a NILS provider (covered nationally).

Prior NILS loans: You must be up to date with any previous NILS loans to be eligible for a new one.

How to Apply for a NILS Loan

Step 1: Visit goodshep.org.au/services/financial-services/nils or call 13 64 57 to find your nearest NILS provider.

Step 2: Contact the local community organisation delivering NILS in your area (credit unions, community organisations, charities).

Step 3: Have ready: identification (driver's licence or passport), proof of income or Centrelink documentation, bank statements (3 months), a quote or invoice for the item you need.

Step 4: Complete a phone or in-person needs assessment. A NILS worker will assess your repayment capacity and confirm eligibility.

Step 5: If approved, the loan is typically paid directly to the supplier within a few days.

NILS vs Payday Loans — Why the Comparison Matters

For people in financial difficulty who need $500–$2,000 for an essential item, the alternative to NILS is often a payday loan. The contrast couldn't be more stark:

For anyone with bad credit or a thin credit file, the credit file invisibility of NILS is a significant additional benefit beyond the zero-interest saving.

Case Study: Diane, Western Sydney — NILS Loan + Credit Repair Combination

Diane, 52, a single mother from Penrith, was on a Centrelink parenting payment and needed a replacement washing machine ($1,400) after hers failed. She also had two defaults on her credit file from a personal loan default in 2021 and an Optus bill from 2020 — both suppressing her score at 472.

Diane applied for NILS through a local community financial service. She received a $1,400 NILS loan to purchase the washing machine. Zero interest, repayable over 18 months at $78/month. No credit check, no credit file impact.

Simultaneously, Diane came to Australian Credit Solutions for a free credit file review. The Optus default (2020) had a Section 21D notice sent to her previous address — she'd moved in mid-2020 and the notice was sent to the old address 3 weeks after she moved. Default removed within 35 days. The personal loan default (2021) was correctly listed with proper procedure and remained on her file.

With one default removed, Diane's score moved from 472 to 559. The remaining 2021 default will expire in 2026.

Diane paid nothing to ACS until the Optus default was removed. The NILS loan was free.

Get a free assessment from Australian Credit Solutions →

Frequently Asked Questions

Does a NILS loan affect your credit score in Australia? No — NILS (No Interest Loan Scheme) loans do not appear on your credit file and do not affect your credit score in any way. NILS providers do not run credit checks and do not report to credit bureaus (Equifax, Experian, or Illion). This is one of the key design features of the scheme, making it accessible to people with bad credit, no credit history, or who want to protect an already fragile credit file.

Who can apply for a NILS loan in Australia? NILS is available to Australian residents on low incomes — typically Centrelink recipients (parenting payments, disability support, aged pension, JobSeeker) or people earning below approximately $70,000 (single) or $100,000 (family) after tax. You must demonstrate ability to repay within your current budget and be located in an area with NILS services.

How much can you borrow through NILS in Australia? Standard NILS loans are up to $2,000. Some programs offer up to $3,000 for essential household items. Loans are paid directly to suppliers, not as cash. Repayments are typically up to 24 months at amounts tailored to your budget.

What is the difference between NILS and StepUP loans? NILS provides loans up to $2,000 at 0% interest, zero fees, for essential goods. StepUP is a related Good Shepherd program offering loans of $800–$5,000 at a low fixed interest rate (currently around 6.99% p.a.) for a broader range of purposes. StepUP does conduct a credit assessment. Both are far better options than payday loans for low-income Australians needing credit.

Is NILS available nationally in Australia? Yes — NILS is available nationally through Good Shepherd's network of community organisations, credit unions, and charities. Coverage in major cities and regional areas is strong. Remote and rural coverage has expanded significantly in recent years. Find your nearest provider at goodshep.org.au or by calling 13 64 57.

Can I get a NILS loan if I have bad credit? Yes — NILS does not conduct credit checks and bad credit does not disqualify you from NILS. Assessment is based on your current income and ability to repay the loan, not your credit history. This makes NILS specifically suitable for people with defaults, bankruptcy, or no credit history who cannot access standard loan products.

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Australian Credit Solutions Pty Ltd holds Australian Credit Licence ACL 532003. Credit repair services are subject to individual assessment. Results may vary. This article provides general information only and does not constitute legal or financial advice.

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